Posts Tagged ‘Monthly Options’

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

XLNX reversed sharply higher a few weeks back after their earnings report exceeded expectations. Since then, the stock price regained it’s 20-day moving average, and more importantly, broke to a fresh 18-year high to clearly signal that bulls are in control. A consolidation has taken place over the past week which is common following an important techincal break and most often precedes a continuation in the direction of the trend.

XLNX Chart November 2018

*source Tradingview.com

If you agree there’s further upside ahead for XLNL, consider this trade which is a bet that the stock will continue to advance over the next six weeks, or at least not decline very much.

Buy To Open XLNL 21DEC18 82.5 Puts (XLNL181221P82.5)
Sell To Open XLNL 21DEC18 85 Puts (XLNL181221P85) for a credit of $1.05 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when XLNL was trading near $86. Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers). Each contract would then yield $102.50 and your broker would charge a $250 maintenance fee, making your investment $147.50 ($250 – $102.50). If XLNL closes at any price above $85 on December 21, both options would expire worthless, and your return on the spread would be 69% (681% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates November 8, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

Last week was a great one for the market (SPY up 2.6%) and an even better one for the Terry’s Tips 8 actual option portfolios. Every one made gains, and the composite average picked up 11%, a record we are quite proud of.

KL corrected lower ahead of earnings and was mostly flat following it. The technical significance is that the stock managed to hold above a triple confluence of support derived from a rising trendline, the 50-day moving average, as well as a horizontal support level. Also significant is the prior correction that took place in late summer that was held higher by the 200-day moving average. These developments suggests that

bulls remain firmly in control from a technical perspective while the close proximity of the current price to support offers an attractive entry point. It’s worth mentioning that the correlation between this stock and the price of Gold has strengthened since last month and that Gold appears to be carving out a bottom, at least a near-term one.

KL Chart November 2018

*source Tradingview.com

If you agree there’s further upside ahead for KL, consider this trade which is a bet that the stock will continue to advance over the next six weeks, or at least not decline very much.

Buy To Open KL 21DEC18 17.5 Puts (KL181221P17.5)
Sell To Open KL 21DEC18 20 Puts (KL181221P20) for a credit of $0.78 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when KL was trading near $20.00. Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers). Each contract would then yield $75.50 and your broker would charge a $250 maintenance fee, making your investment $174.50 ($250 – $75.50). If KL closes at any price above $20 on December 21, both options would expire worthless, and your return on the spread would be 43% (402% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates November 1, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

Last week was an awful one for the market. SPY fell 4% after whip-sawing both up and down all week. Most option portfolios probably suffered as well. We were delighted that our newest portfolio which trades options on MSFT notched a gain of 20.4% for this otherwise bad week for the market. Chalk up another victory for well-executed option strategies.

Payal appears to be supported near the $83 price point which was where the stock gapped up to following their earnings report earlier this month. The 20 and 50-day moving averages are converging in this area as well to offer further technical support. In the event of a dip lower, further support near the psychological $80 handle is likely to trigger strong buying as technical traders often look to position following a gap close.

PYPL Chart October 2018

*source Tradingview.com

If you agree there’s further upside ahead for PYPL, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.

Buy To Open PYPL 30NOV18 80 Puts (PYPL181130P80)
Sell To Open PYPL 30NOV18 83 Puts (PYPL181130P83) for a credit of $1.06 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when PYPL was trading near $83. Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers). Each contract would then yield $103.50 and your broker would charge a $300 maintenance fee, making your investment $196.50 ($300 – $103.50). If PYPL closes at any price above $83 on November 30, both options would expire worthless, and your return on the spread would be 53% (605% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates October 25, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

Technical strength in DG is seen best via correlation when looking at growth stocks and US equity indices. As well, the stock appears to have recently broken above a bullish flag pattern, climbing above the 50-day moving average in the process. DG ended the past week holding support near 109 and shows further support from a strong confluence found just above 107.

DG Chart October 2018

*source Tradingview.com

If you agree there’s further upside ahead for DG, consider this trade which is a bet that the stock will continue to advance over the next five weeks, at least a little bit.

Buy To Open DG 23NOV18 105 Puts (DG181123P105)
Sell To Open DG 23NOV18 110 Puts (DG181123P110) for a credit of $1.75 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when DG was trading near $110. Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers). Each contract would then yield $172.50 and your broker would charge a $500 maintenance fee, making your investment $327.50 ($500 – $172.50). If DG closes at any price above $110 on November 23, both options would expire worthless, and your return on the spread would be 53% (605% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates October 18, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

ULTA made a notable technical break in early September by clearing above horizontal resistance at $260 that had held it lower throughout the summer. The stock has corrected lower since hitting highs around 290 which may offer an attractive entry point. The recent decline has not accompanied much downside momentum, which is especially significant when considering overal market conditions, suggesting a correction is taking place rather than a turn in the near-term trend.

ULTA Chart October 2018

*source Tradingview.com

If you agree there’s further upside ahead for ULTA, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.

Buy To Open ULTA 16NOV18 270 Puts (ULTA181116P270)
Sell To Open ULTA 16NOV18 275 Puts (ULTA181116P275) for a credit of $2.18 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when ULTA was trading near $276. Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers). Each contract would then yield $215.50 and your broker would charge a $500 maintenance fee, making your investment $284.50 ($500 – $215.50). If ULTA closes at any price above $275 on November 16, both options would expire worthless, and your return on the spread would be 76% (867% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates October 11, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

From a technical perspective, PLAY is seen bouncing from a confluence of support derived from the 20-day moving average and a horizontal level at $62.50. Further support is seen slightly below the confluence area from a rising trendline that originates from a low posted in late July.

PLAY Chart October 2018

*source Tradingview.com

If you agree there’s further upside ahead for PLAY, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.

Buy To Open PLAY 9NOV18 60 Puts (PLAY18119P60)
Sell To Open PLAY 9NOV18 63 Puts (PLAY18119P63) for a credit of $1.03 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when PLAY was trading near $64. Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers). Each contract would then yield $100.50 and your broker would charge a $300 maintenance fee, making your investment $199.50 ($300 – $100.50). If PLAY closes at any price above $63 on November 9, both options would expire worthless, and your return on the spread would be 50% (570% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates October 4, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum. The actual Terry’s Tips portfolio that trades most of these ideas started out 2018 with $5000. Along the way, we withdrew the entire $5000 from the portfolio so subscribers who were following it would have all their money back and be playing with their profits. The portfolio is now worth $4980 which is pretty darn close to doubling their money in nine months. Other portfolios we conduct for paying subscribers have done better, but we are proud of this one as well.

The technical outlook for MOMO points to strong downside support and highlights upside potential. The stock closed on Friday above a confluence of support which includes the 50-day moving average, a horizontal level at $43.17 as well as the lower bound of a rising trend channel that has encompassed price action for the past month. Also, in candlestick analysis, Friday’s candle has taken the shape of what is commonly known has a bullish hammer candle. This signals a strong hold of support and potential for a reversal from the recent eight-day correction.

*source Tradingview.com

If you agree there’s further upside ahead for MOMO, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.

Buy To Open MOMO 02Nov18 41 Puts (MOMO181102P41)
Sell To Open MOMO 02Nov18 43.5 Puts (MOMO181102P43.5) for a credit of $1.00 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when MOMO was trading near $144. Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers). Each contract would then yield $97.50 and your broker would charge a $250 maintenance fee, making your investment $152.50 ($250 – $97.50). If MOMO closes at any price above $43.50 on November 02, both options would expire worthless, and your return on the spread would be 64% (730% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates September 27, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

Terry

Consider Buying the Post-Earnings Dip in Adobe Systems (ADBE)

Adobe’s stock price has seen a steady rise over the last few years, and from both a technical and fundamental standpoint, there is a strong case to be made that it will continue. These following two articles discuss the recent earnings report and where the stock may go from here – Adobe: Stock Marches Forward With Another Record Quarter and Should You Buy Adobe Systems at Its All-Time High?. As well, there have been several price target upgrades as of late and a few of the more bullish analysts think the stock can even cross above the $300 price point.

ADBE Chart September 2018 Adobe

ADBE corrected lower in the past week and is seen trading near a significant confluence of support. The 50-day moving average is coming into play, a horizontal level at $256 that was respected as both support and resistance last month, and two rising trend channels. The small channel formation originates from a low posted in late July while the longer term trend channel has encompassed price action for a few days short of a year.

If you agree there’s further upside ahead for ADBE, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.

Buy To Open ADBE 26OCT18 255 Puts (ADBE181026P255)
Sell To Open ADBE 26OCT18 260 Puts (ADBE181026P260) for a credit of $1.97 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when ADBE was trading near $261. Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will be $2.50 per spread. Each contract would then yield $194.50 and your broker would charge a $500 maintenance fee, making your investment $305.50 ($500 – $194.50). If ADBE closes at any price above $260 on October 26, both options would expire worthless, and your return on the spread would be 64% (730% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates September 20, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum. The actual portfolio that Terry’s Tips carries out with these plays we send to you each week has gained 98.5% so far this year. We started out 2018 with $5000 in the portfolio and withdrew that amount in June so that subscribers who mirrored it in their own account or had trades executed for them with the free Auto-Trade service at thinkorswim have almost $5000 left and it is entirely profits for them.

There are several technical developments over the last month or so that suggest Netflix has turned bullish once again. The stock price is seen climbing above horizontal resistance at $356 and holding above the 20-day moving average. Aside from that, a recent convergence with the S&P 500 might be sending the strongest signal of all. Note that NFLX diverged from the index for about a month starting from mid-July to correct lower. Since around the middle of August, the stock price has once regained its correlation with the popular index, which is often a tell that an important bottom might be in place. The S&P 500 is added to the chart below and denoted in bars to illustrate the divergence and subsequent convergence.

NFLX Chart September 2018

*source Tradingview.com

If you agree there’s further upside ahead for NFLX, consider this trade which is a bet that the stock will continue to advance over the next four weeks, at least a little bit.

Buy To Open NFLX 12OCT18 362.5 Puts (NFLX181012P362.5)
Sell To Open NFLX 12OCT18 365 Puts (NFLX181012P365) for a credit of $1.18 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when NFLX was trading near $365. Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers). Each contract would then yield $115.50 and your broker would charge a $250 maintenance fee, making your investment $134.50 ($250 – $115.50). If NFLX closes at any price above $365 on October 12, both options would expire worthless, and your return on the spread would be 86% (1256% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates September 13, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

This week we are looking at another of the Investor’s Business Daily (IBD) Top 50 List companies. We use this list in one of our options portfolios to spot outperforming stocks and place option spreads that take advantage of the momentum.

The actual Terry’s Tips portfolio which trades essentially every weekly play that we send to you has gained 91% so far this year (after paying all commissions, of course). The portfolio started out the year with $5000, and on June 15, 2018, we withdrew $5000 from the portfolio so that all subscribers who followed it would all their money back and be playing with pure profits. The portfolio is now worth $4552.

I especially like this week’s idea because I like Mastercard and believe that last week’s weakness in the stock price was unwarranted. Enjoy the full report below.

MA has been trading in an uptrend channel that originates back to a low posted in December 2017. The stock price pulled back in the past week and is near support that consists of a horizontal level at $208 as well as the 20-day moving average. Slightly below the support confluence is the lower bound of the uptrend channel. In this context, the stock appears to be well support with a clear upside bias.

MA Chart September 2018

*source Tradingview.com

If you agree there’s further upside ahead for MA, consider this trade which is a bet that the stock will continue to advance over the next five weeks, or at least not decline very much.

Buy To Open MA 12OCT18 207.5 Puts (MA181012P207.5)
Sell To Open MA 12OCT18 210 Puts (MA181012P210) for a credit of $0.93 (selling a vertical)

This price was $0.02 less than the mid-point of the option spread when MA was trading near $211. Unless the stock rallies quickly from here, you should be able to get close to this amount.

Your commission on this trade will only be $2.50 per spread (the rate charged by thinkorswim for Terry’s Tips’ subscribers). Each contract would then yield $90.50 and your broker would charge a $250 maintenance fee, making your investment $159.50 ($250 – $90.50). If MA closes at any price above $210 on October 12, both options would expire worthless, and your return on the spread would be 57% (650% annualized).

Changes to Investor’s Business Daily (IBD) Top 50 This Week:

IBD Underlying Updates September 6, 2018

We have found that the Investor’s Business Daily Top 50 List has been a reliable source of stocks that are likely to move higher in the short run. Recent additions to the list might be particularly good choices for this strategy, and deletions might be good indicators for exiting a position that you might already have on that stock.

As with all investments, you should only make option trades with money that you can truly afford to lose.

Success Stories

I have been trading the equity markets with many different strategies for over 40 years. Terry Allen's strategies have been the most consistent money makers for me. I used them during the 2008 melt-down, to earn over 50% annualized return, while all my neighbors were crying about their losses.

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tastyworks, Inc. and Terry’s Tips are separate, unaffiliated companies and are not responsible for each other’s services and products. Options are not suitable for all investors as the special risks inherent to options trading my expose investors to potentially rapid and substantial losses. Options trading in a tastyworks account is subject to tastyworks’ review and approval. Please read Characteristics and Risks of Standardized Options before investing in options